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Rising COVID-19 cases shift risk to the downside: FXTM

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(Kitco News) A spark of new coronavirus cases is putting heavy pressure on U.S. equities Monday morning, triggering a much broader selloff, including gold. “Equity markets kicked off Monday on the back foot following three weeks of consecutive declines in US stocks, which marked the longest weekly losing streak since 2019,” wrote FXTM chief market strategist Hussein Sayed. The biggest downward drivers are the lack of new fiscal stimulus measures and rising COVID-19 cases. “Investors are becoming increasingly worried about the momentum in the economic recovery given the resurgent numbers of global Covid-19 cases and lack of progress on a new US stimulus package,” Sayed says. “Although President Trump signaled his readiness to back a bigger stimulus bill last week, the Supreme Court’s empty seat left by the passing of Ruth Bader Ginsburg is likely to complicate the matter. The fight between the President and Congressional Democrats on whether to fill the vacant seat now or wait until after the election is expected to lead to more delays in reaching a middle ground on a new fiscal package.”

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